Increased economic activity between Curacao and Suriname I: new Treaties in the making

February 25, 2015 3:10 PM
The relationship between Curacao and Suriname is a historical one. Both countries are former colonies of The Netherlands. Both countries also have the Dutch language as a main language and the legal systems of both jurisdictions are based on the same principles.
 
As a consequence of an impressive outburst of economic activities in Suriname in the past year, Suriname has experienced a substantial increase in foreign investments, of which a significant part originates from or through Curacao.
 
As a consequence of these increased economic activities, the two countries are in the process of starting negotiating two new treaties. One of the treaties, in fact an extension of an already existing treaty, deals with the reciprocal recognition and enforcement of judgments and of authentic acts (notarial deeds) in civil matters. 
 
Suriname already has an agreement with The Netherlands on this subject. In 1975 Suriname became independent of the Kingdom of The Netherlands and the Republic of Suriname was born. On 10 January 1979, the Agreement on the reciprocal recognition and enforcement of legal judgments and authentic acts in civil cases (Trb. 1976, 144 and Trb. 1979, 7), came into force. Negotiations will deal with the possible extension of this treaty to Curacao (and possibly also to Aruba).
 
Since the establishment of this treaty, to our knowledge only a few Dutch legal decisions were rendered on which this treaty has any bearing.
 
One judgment is illustrative. In a case before the High Court of Amsterdam (16-12-2008. BH0610), the plaintiff had requested a security for the costs of the proceedings, since the respondent on appeal was domiciled in Suriname. The High Court ruled that since a judgment rendered in The Netherlands could, under the scope of the treaty, also be enforced in Suriname, a security was not needed and therefore the request of the plaintiff was denied.
 
It would also be important from another perspective for Curacao to become a party to this treaty on the enforcement of judgments in civil matters.The New York Arbitration Convention of 1954, which deals with the recognition and enforcement of arbitral judgments, has a worldwide membership following, including virtually all the countries of Latin America, but with the notable exception of Suriname and the two (British and French) Guyanas.
 
From this perspective, also considering the geographical close proximity between the two countries, it is of importance that the legal basis of doing business in Suriname (and Curacao) is strengthened, by the possibility of obtaining judgments outside of Suriname, (i.e. before a Curacao Court) and be able to directly enforce such judgments in Suriname (and vice versa). 
 
The other treaty is a tax treaty, which sees on avoiding double taxation and the prevention of tax evasion on income and capital. Already on this subject a tax treaty between the Netherlands and Suriname is in existence. On 13 April 1977, the Agreement on the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and capital gains, came into force (Trb. 1975, 34 and Trb. 1977, 79).  Negotiations will soon be forthcoming with respect to the tax treaty between Curacao and Suriname, which has as its main purpose to obviate double taxation. Future foreign investors focusing on Suriname can consequently avoid double taxation if they invest from or through Curacao in Suriname and vice versa.
 
This tax treaty in combination with the  aforementioned treaty on the reciprocal recognition and enforcement of judgments in civil matters, will provide a strong legal and tax fundament for the increased stream of business and investments between the two countries.
 
 
This article was published by VanEps Kunneman VanDoorne in July 2013 - author Len Huard
 
 
Related article:
In this follow-up article, a third treaty (the Treaty on the Reciprocal Protection of Investments between the Kingdom of The Netherlands and the Republic of Suriname) is being discussed.
 

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